Coyote Blog

A small victory against the relentless march of the state regulators and licensors

Eyebrow threading to remove facial hair, a practice which has ancient roots in Eastern countries such as India and Iran, is gaining popularity around the country.

And threaders can now operate freely in the state without a cosmetology license after an October court settlement determined that the Arizona Board of Cosmetology would no longer regulate the trade.

The consent judgment resulted from a lawsuit filed in Maricopa County Superior Court by five threaders, including Gutierrez.

The threaders argued that the Board of Cosmetology was merely trying to help more traditional hair removal outfits remove a source of low-cost competition.  The threaders were represented by the IJ, who do great work for economic liberty

As GM was failing, I argued for the normal laws of bankruptcy to be allowed to work.  After all, valuable brands and manufacturing facilities were not just going to go *poof* — someone would purchase them and employ them, and hopefully those someone’s would to a better job than the previous owners and managers.

A big part of the “logic” for bailout and Presidential intervention in the auto companies was that auto purchases would halt if consumers were unsure whether their warranties would be honored and service would be available.

From an AP story, November 13, 2008

Advocates for the nation’s automakers are warning that the collapse of the Big Three – or even just General Motors – could set off a catastrophic chain reaction in the economy, eliminating up to 3 million jobs and depriving governments of more than $150 billion in tax revenue.

Industry supporters are offering such grim predictions as Congress weighs whether to bail out the nation’s largest automakers, which are struggling to survive the steepest economic slide in decades….

Automakers say bankruptcy protection is not an option because people would be reluctant to make long-term car and truck purchases from companies that might not last the life of their vehicles.

Well, it turns out that this was partially bogus.  The written warranties are still honored, but GM argues it left liability for any defects or design problems in the old shell company

General Motors Co (GM.N) is seeking to dismiss a lawsuit over a suspension problem on more than 400,000 Chevrolet Impalas from the 2007 and 2008 model years, saying it should not be responsible for repairs because the flaw predated its bankruptcy.

The lawsuit, filed on June 29 by Donna Trusky of Blakely, Pennsylvania, contended that her Impala suffered from faulty rear spindle rods, causing her rear tires to wear out after just 6,000 miles. [ID:nN1E7650CT]

Seeking class-action status and alleging breach of warranty, the lawsuit demands that GM fix the rods, saying that it had done so on Impala police vehicles.

But in a recent filing with the U.S. District Court in Detroit, GM noted that the cars were made by its predecessor General Motors Corp, now called Motors Liquidation Co or “Old GM,” before its 2009 bankruptcy and federal bailout.

The current company, called “New GM,” said it did not assume responsibility under the reorganization to fix the Impala problem, but only to make repairs “subject to conditions and limitations” in express written warranties. In essence, the automaker said, Trusky sued the wrong entity.

“New GM’s warranty obligations for vehicles sold by Old GM are limited to the express terms and conditions in the Old GM written warranties on a going-forward basis,” wrote Benjamin Jeffers, a lawyer for GM. “New GM did not assume responsibility for Old GM’s design choices, conduct, or alleged breaches of liability under the warranty.”

Of course, this happens all the time in bankruptcy  (and it is my experience, but I am not a legal expert) that GM may or may not succeed in this argument.  It is not always possible to leave liabilities behind in an old corporate shell, or else companies would reorganize every year.

But the point is that the special treatment of GM was supposed to be to protect consumers, and that turns out to be BS.  The warranties were likely always going to be protected in any bankruptcy, as such consumer benefits nearly always are in chapter 11 (the fact that you still hold any frequent flyer miles is proof of this, as nearly every airline in the country has been through chapter 11 in the last couple of decades and none of them disavowed their frequent flyer miles, despite the fact that holders are the most unsecured of unsecured creditors).

Our rulers are pretty good at finding tricky ways to expand their power

…several environmental groups that have received millions in EPA grants regularly file suit against that same agency. A dozen green groups were responsible for more than 3,000 suits against the EPA and other government agencies over the past decade, according to a study by the Wyoming-based Budd-Falen Law Offices.

The EPA even tacitly encourages such suits, going so far as to pay for and promote a “Citizen’s Guide” that, among other things, explains how to sue the agency under “citizen suit” provisions in environmental laws. The guide’s author — the Environmental Law Institute — has received $9.9 million in EPA grants over the past decade.

And, to top it off, critics say the EPA often ends up paying the groups’ legal fees under the Equal Access to Justice Act.

“The EPA isn’t harmed by these suits,” said Jeffrey Holmstead, who was an EPA official during the Bush administration. “Often the suits involve things the EPA wants to do anyway. By inviting a lawsuit and then signing a consent decree, the agency gets legal cover from political heat.”

 

What do corn farmers and Hollywood studios have in common?  They both have an uncanny ability to force self-serving legislation through Congress.  This week’s bit of sucking up to Hollywood is the PROTECT IP act, currently under consideration in Congress:

An ideologically diverse group of 90 law professors has signed a letter opposing the PROTECT IP Act, the Hollywood-backed copyright enforcement/Internet blacklist legislation now working its way through Congress. The letter argues that its domain-blocking provisions amount to Internet censorship that is barred by the First Amendment.

Jointly authored by Mark Lemley, David Levine, and David Post, the letter is signed not only by prominent liberals like Larry Lessig and Yochai Benkler, but also by libertarians like Post and Glenn “Instapundit”Reynolds.

“The Act would allow courts to order any Internet service to stop recognizing [a] site even on a temporary restraining order… issued the same day the complaint is filed,” they write. Such a restraining order, which they describe as “the equivalent of an Internet death penalty,” raises serious constitutional questions.

The Supreme Court has held that it’s unconstitutional to suppress speech without an “adversary proceeding.” That is, a speaker must, at a minimum, be given the opportunity to tell his side of the story to a judge before his speech can be suppressed.

Yet under PIPA, a judge decides whether to block a domain after hearing only from the government. Overseas domain owners (and the speakers who might make use of their websites) aren’t offered the opportunity to either participate in the legal process or appeal the decision after the fact. (Affected domain owners may file a separate lawsuit after the fact.) This, the professors say, “falls far short of what the Constitution requires before speech can be eliminated from public circulation.”

 

SB7 has some good observations about risk:

I was listening to the WSJ radio podcast while getting some dinner ready, and one of their reporters said, in the context of discussing Fukushima, that some of the engineers at the plant “knew there was a risk” in the plant’s older design and could conceivably face charges for not doing something about said risk.

This kind of talk really grinds my gears.  In any engineering situation there is always some risk.  You can have less risk, or more risk, but risk is not something you either have or do not have.

I will go one step further.  This ex post facto witch hunt aimed at folks who discussed risks  (an pogrom that occurs in nearly every product liability lawsuit with fishing expeditions through company memos) is the WORST possible thing for consumers concerned about the safety of their products and environment.  Engineers have to feel free to express safety concerns within organizations no matter how hypothetical these suppositions may be.

Some concerns will turn out to be unfounded.  Some suggested risks will be deemed too small to economically overcome.  And some will turn out to be substantial and require action.  And sometimes well-intentioned people will make what is, in retrospect, the wrong trade-offs with risks.   These witch hunts only tend to suppress this very valuable and necessary internal dialog within organizations.  Nothing is going to turn the brains of engineers off faster than an incentive system that punishes them retroactively for well-intentioned discussions about risk.

Yeah, I know, this is volume one hundred and something in a series, but it is such a crystal clear example of government licensing working primarily to protect incumbent competitors in an industry I have to share it.

Suppose you’re the owner of a taxicab company in a largish metropolitan area. One day you notice some taxis tooling around town—and they’re not yours. They belong to an upstart competitor. His cars are newer, his drivers are nicer, and his fares are lower. Pretty soon your profits start shrinking. What are you going to do about it?

You have a couple of choices. Option A: Invest a lot of money in new vehicles, customer-service training for your drivers, GPS systems to map faster routes and so on. A lot of expense. A lot of effort.

So you go for Option B: Invest a little money in a few politicians, who adopt a medallion law: Only licensed operators with city-issued taxi medallions may operate cabs. The oldest cab companies get first dibs on the medallions, at the lowest rates. Only a few medallions are left over for the new guy, and he can’t afford them anyway. Bingo—your competition problem is solved. The customers might not like it, but what are they going to do—walk?

Apparently this is exactly what is happening in DC

Now it’s the District of Columbia’s turn. Four members of the D.C. City Council have introduced a bill that would create a medallion system for the nation’s capital. Medallion prices would start at $250 for the most established taxi companies and, for the newer entrants, run as high as $10,000. At least initially. As time wore on, it’s likely that the price of a medallion would go up for everyone. That’s what has happened in places such as New York, where a government permission slip to drive a cab costs about $600,000. In Boston, which initially capped medallions at 1,525 in the 1930s—and more than a half-century later had added only 250 more—a medallion will cost you $400,000.

At present the District has more than 10,000 licensed taxi drivers; the proposed legislation would establish only 4,000 medallions. Needless to say, such artificially imposed scarcity also drives up prices. A study by Natwar Gandhi, the District’s chief financial officer, found that fares in cities with medallion systems are 25 percent higher than in cities with open taxi markets.

By the way, for extra points, here is a lawsuit right out of Atlas Shrugged

That story has played out in many cities across the United States, with sometimes amusing variations. A decade or so ago, Minneapolis (population 300,000-plus) allowed a grand total of 343 taxis to operate until Luis Paucar, an immigrant, filed suit. The city council decided to allow another 45 cabs. Then the existing cab companies sued, using the creative legal theory that they had a constitutional right not to face competition. (They lost.)

I thought this was ironic….

Germany–Standing in Aisle 1 of a local Aldi supermarket, between the €2.59 ($3.62) bottles of sparkling wine and the packaged bread, German master baker Wolfgang Schäfer is in enemy territory.The third-generation baker lobs 15 cents into the massive, beige-colored automat before him, presses a button and cocks his ear to the machine for any clues to what’s transpiring inside. Almost instantly, a warm wheat roll plunks into the bin below.

“Not even two seconds,” says the 55-year-old Mr. Schäfer, who had switched out of a white shirt embroidered with his family bakery’s insignia into a less conspicuous checkered button-down for the stealth fact-finding mission. “Whatever goes on in there, it’s certainly not baking.”

What exactly does happen inside the automats has become a matter of dispute between Aldi Süd, a discount supermarket chain, and most of Germany’s 15,000 traditional bakeries, since the company began installing the machines in hundreds of its German stores this year. The automats are emblazoned with the word Backofen, or “baking oven,” and pictures of bowls of whole grain and bouquets of wheat. Aldi markets the rolls and bread the machines dispense as “fresh out of the oven–direct into the bag.”

But to thousands of German bakers, Aldi’s freshness claim is half-baked. Worse, they charge, it misleads customers who might equate the German discounter’s baked goods with the bread they and their employees knead, shape and bake through the wee hours of every morning.

The German Bakers’ Confederation, steward of the country’s centuries-old bread-making tradition, is taking Aldi Süd–one of the two companies that make up the Aldi empire–to court on claims of deceptive advertising. Aldi Süd says it rejects the claims in the lawsuit.

…in the context of this (see part IV)

This is a legend of success and plunder
And a man, Tom Smith, who squelched world
hunger.
Now, Smith, an inventor, had specialized
In toys. -So, people were surprised
When they found that he instead
Of making toys, was BAKING BREAD!

The way to make bread he’d conceived
Cost less than people could believe.
And not just make it! This device
Could, in addition, wrap and slice!
The price per loaf, one loaf or many:
The miniscule sum of under a penny….

If you never have read the whole poem, do so.  In concludes thus:

Price too high? Or price too low?
Now, which charge did they ma~e?
Well, they weren’t loath to charging both
With Public Good at stake!
In fact, they went one better They
charged “monopoly!”

No muss, no fuss, oh woe is us,
Egad, they charged all three!
“Five years in jail,” the judge then said.
44You:>re lucky iCs not worse.
Robber Barons must be taught
Society Comes First!”

Now, bread is baked by government.
And as might be expected,
Everything is well controlled;
The public well protected.
True, loaves cost a dollar each.
But our leaders do their best.
The selling price is half a cent.
(Taxes pay the rest!)

Most everyone knows that Al Capone was finally nailed for tax evasion, rather than murder, robber, extortion and all the more heinous crimes for which he was mostly likely guilty.  For years, an unfortunately relatively small group of us here in Phoenix have tried to see Sheriff Joe Arpaio brought to justice, or at least removed from office, for his numerous abuses of power.   Lacking the success so far, Arpaio may finally go down for fraud in his management of County funds.

In something that should be a surprise to no one, even his supporters, the supremely arrogant Arpaio did not like state law and the county supervisors rules on where he could spend different parts of his budget.  So it appears he created a shadow payroll system that has only just been discovered that has been paying different people different amounts for different purposes than what shows up in the official County payroll systems, and has been doing so for over a decade.

Deputy County Manager Sandi Wilson and her staff in the Office of Management and Budget for months have worked to figure out how extensive financial problems are, and she expressed shock at the hidden system.

“They’ve developed a system that basically tracks where they are working versus where they are being paid, and they did not update the official database, which led to the potential problems,” Wilson said. “I think they deliberately hid this info from us.”

The employee-tracking database was in a secure criminal-justice computer system accessible only to the Sheriff’s Office. Control of access to that system, known as ICJIS, has been the subject of a long-running and expensive legal battle during the past two years.

County administrators say they were puzzled by the sheriff’s willingness to sue over what they viewed as minor issues related to control of the ICJIS system. The fight by the sheriff to block county access to the system has cost more than $1.6 million.

County officials believe Sheriff’s Chief Deputy David Hendershott sought to limit access to the system to hide the shadow payroll records it contained. Those records showed that potentially hundreds of employees who did no work in the jails were being paid with detention funds.

“That’s a reasonable conclusion to draw, but we don’t know for sure,” Irvine said. “From Maricopa County’s perspective, the ICJIS dispute and lawsuit has made no sense.”

County officials sent information on the payroll system to the U.S. Attorney’s Office for review. That office is conducting a separate abuse-of-power probe of Sheriff Arpaio, his employees and others.

The article fails to mention it, but I believe that the county computer facility mentioned above was the same one that Arpaio sent armed deputies storming in to take over about a year ago.  At the time, no one really bought his explanation that it was about protecting sensitive criminal information from prying eyes.  I hypothesized it was to take control of an email server that had incriminating information about Arpaio, but now it turns out it may have been to protect his shadow payroll system.

When I grew up in Houston, we told Aggie jokes, like others might tell blond jokes or fill-in-disfavored-ethnic-group jokes.  Anyway, way back in the 70′s a joke went around something like this:

Did you hear about the Aggie who was caught in the New York blackout?  He was stranded on an escalator for three hours.

I remember this only after seeing this story via overlawyered:

Kim Kreis, et al. v. American Multi-Cinema Inc.; AMC Entertainment Inc., No. CGC-10-501102 (San Francisco Super. Ct. filed June 25, 2010).

Trip and fall lawsuit. The plaintiffs injured themselves on a stationary escalator at the defendants’ movie theatre, as there was no sign posted warning them that it was not moving.

Is there any unwelcome outcome nowadays, however trivial, that can’t spawn a lawsuit?

The blaming of private companies for government procurement errors is one I deal with frequently at my privatization blog.  This seems to be a particularly egregious example:

Maricopa County officials can’t sue the Sheriff’s Office for buying a $465,000 bus without their approval, so now they want to sue the bus company.

Precisely why Motor Coach Industries would be sued over the internal squabble remains unclear.

The county has maintained in this months-long bus battle that Sheriff Arpaio’s office bought the vehicle with Jail Enhancement funds, when it should have used a typical county procurement process.

From the bus company’s point of view, though, the Sheriff’s Office was a customer with cash. For the county to demand a full refund, without so much as a deduction for the depreciation, seems like a raw deal for MCI.

Cari Gerchick, spokeswoman for the county, says text of the lawsuit won’t be released until after the Board of Supervisors votes on it at Monday’s meeting. She could not provide the legal justification for the expected lawsuit, beyond saying that MCI “should have known” the MCSO had not followed the county’s procurement process.

Get that?  The company should have known that our County’s chief law enforcement officer was not following the law.  This is obviously an absurd contention, but further the company had two geographic disadvantages:  1.  Not being from AZ, they don’t know just how unethical our sheriff really is; and 2.  Being from Chicago, even if they had recognized unethical behavior, they would have assumed it was perfectly legal

This is pretty scary.  From the Massachusetts state treasurer, the state health care system (essentially the model for the current version of Obamacare) is going bankrupt, and only huge cash infusions from the Federal government are hiding the full disaster.

“If President Obama and the Democrats repeat the mistake of the health insurance reform here in Massachusetts on a national level, they will threaten to wipe out the American economy within four years,” Cahill said in a press conference in his office.

Echoing criticism leveled by congressional Republicans in recent weeks, Cahill said, “It is time for the president, the Democratic leadership, to go back to the drawing board and come up with a new plan that does not threaten to bankrupt this country.”

[T]he state’s health insurance law…Cahill said, “has nearly bankrupted the state.”

Cahill said the law is being sustained only with the help of federal aid, which he suggested that the Obama administration is funneling to Massachusetts to help the president make the case for a similar plan in Congress.

“The real problem is the sucking sound of money that has been going in to pay for this health care reform,” Cahill said. “And I would argue that we’re being propped up so that the federal government and the Obama administration can drive it through” Congress.

The Democrats have no good ideas for controlling Medicare costs after a government takeover.  If they did, they would have already implemented these ideas on Medicare or in Massachusetts.  Their only plan is price controls and rationing.  Here is an example of price controls hitting a wall in Medicare:

Walgreens drugstores across the state won’t take any new Medicaid patients, saying that filling their prescriptions is a money-losing proposition — the latest development in an ongoing dispute over Medicaid reimbursement….

In a news release, Walgreens said its decision to not take new Medicaid patients stemmed from a “continued reduction in reimbursement” under the state’s Medicaid program, which reimburses it at less than the break-even point for 95 percent of brand-name medications dispensed to Medicaid patents….

Washington was reimbursing pharmacies 86 percent of a drug’s average wholesale price until July, when it began paying them just 84 percent. While pharmacies weren’t happy about the reimbursement reduction, the Department of Social and Health Services said that move was expected to save the state about $10 million.

Then in September came another blow. The average wholesale price is calculated by a private company, which was accused in a Massachusetts lawsuit of fraudulently inflating its figures. The company did not admit wrongdoing but agreed in a court settlement to ratchet its figures down by about 4 percent.

So the Government is reimbursing retailers at 80% of wholesale costs.  Even forgetting their overhead,  Walgreens was asked to sell dollar bills to the government for 80 cents.

What both stories have in common are government health plans that are subsidized from the outside:  The Feds are pouring money into Massachusetts and money is sucked out of the private medical side to subsidize Medicare.  But what happens when there is only one system, when there is nothing outside of it to subsidize it?  What are they counting on to save them?

I will say that I have a certain fondness for the idea of tossing everyone in Congress in jail on a giant RICO prosecution.  So Thomas and Apraio’s crazy RICO suit naming most everyone of any importance in the county government and judicial system as conspirators has a certain appeal.  Unfortunately, unlike my dream RICO suit, the basis for the suit is that Arpaio and Thomas were consistently prevented from excercising unchecked power

In essence, the lawsuit alleges that any county official who at any point attempted to stop Thomas and Arpaio from doing anything — whether it’s prosecuting Don Stapley, “investigating” the $341 million court tower project, or repeatedly suing Thomas’ own clients — is part of a criminal enterprise. That includes judges who ruled against them, attorneys who opposed them in court (like Ed Novak and Tom Irvine) and county employees who attempted to stop the insanity.

I guess its lucky they didn’t send the SWAT team in for her, as she might be dead now:

[Victoria] Aguayo has filed a lawsuit in Maricopa County Superior Court, after she was arrested, indicted, and nearly prosecuted for her “role” in the infamous “Desert Divas” prostitution ring.

One problem: Aguayo was not a “desert diva” and the evidence suggesting she was is laughable at best.

On one of the “Desert Divas’” many Web sites, the agency advertised an “escort” named “Tia.” “Tia” is described on the site as being “thin, white, and blonde” and has a tattoo on her stomach that is clearly visible in the topless photo of the “diva” Aguayo’s lawyer was kind enough to send New Times.

Phoenix Police Detective Christie Hein identified Aguayo as “Tia” based on the photo on the Web site when she arrested her on August 28, 2008, the lawsuit claims.

We’ve seen pictures of both “Tia” and Aguayo and we gotta say if Aguayo can be identified as “thin, white, and blonde,” so can Aretha Franklin.

Aguayo is — to put it politely — more of a “plus-sized” woman, she’s black, and is missing the tattoo that is so clearly visible in the photo of “Tia” on the “Desert Diva” Web site.

Simple, um, mistake, right?

After being arrested, Aguayo spent nearly two months in jail before she was granted a supervised release pending an upcoming trial.

While she was in the clink, Aguayo lost custody of her daughter, Jasmine, and has since been unable to get her back.

I hope JD is wrong:

Further complicating this picture is that Sheriff Joe Arpaio, despite erratic and confrontational conduct that has repeatedly put him at the wrong end of lawsuits and press coverage, is immensely popular with Maricopa County voters. In fact, recent polling suggests that the governor’s office is his for the asking. He’s a favorite for the Republican nod and an apparent shoe-in in the general election.

I was under the impression that the Repub’s cut Arpaio loose in the last election, but I don’t really follow the politics stuff much.  JD has an update on the latest Arpaio shenanigans, as does Radley Balko:

• The Maricopa County Sheriff’s Office announced on Tuesday that Stoddard would surrender to jail ahead of his midnight deadline to aplogize. But when Stoddard showed up, the jail refused to book him, citing a “clerical error.” Stoddard insisted on spending the night in jail anyway.
• Maricopa County Sheriff Joe Arpaio announced he has filed a federal lawsuit against the county and its judges, alleging a “widespread conspiracy” against Arpaio and his officers. Arpaio remarkably and apparently with no self-awareness whatsoever called the county a “good ole boys network,” and commented that he had “never seen these kinds of things occur in the justice system.” Arpaio also called Donahoe’s contempt finding against Stoddard a “vendetta,” and said, “For political reasons, [Stoddard's] been thrown to the wolves.”
• Yesterday, the day after Stoddard spent a night in jail, 19 sheriff’s deputies scheduled to work security at the courthouse called in sick, throwing the day’s court proceedings into disarray. The building also had to be evacuated after a phone-in bomb threat.
• As crowds returned after the bomb threat was cleared, the law enforcement unions commenced with a conveniently-timed rally in front of the courthouse, calling Stoddard a “victim” and demanding that he be released from jail.

Wow, it sure is a real coincidence when a bomb threat against the public defenders (it was a public defender the deputy originally stole the document from) at the exact same moment the sheriff’s were trying to disrupt the courthouse over a dispute involving the public defenders office.

Those who don’t live here would be appalled and disgusted by how such a large segment of the local population absolutely revere this man.  He’s like the right-wing Obama, living off a manufactured image.

This may see obvious to those of you in the rest of the country, but there are real problems with treating a man uniquely allowed to use force against the citizenry like a rock star.  And that is how certain segments of the local population treat Sheriff Joe Arpaio.   As one abuse of power after another is revealed, his supporters respond  “Isn’t he so colorful, just like an old-time western sheriff.”

For the rest of us his schtick gets old.  The county has spent millions defending lawsuit after lawsuit against him.  The INS has stripped him of his power to track down illegal immigrants, but he still ventures out on sweeps to arrest folks for driving while Mexican, arresting more people of Mexican decent than I though even existed in certain neighborhoods.  He has arrested reporters who criticized him, and arrested people who applauded a speaker who criticized him.  He even launched a mini-coup attempt against the County which employs him, invading the County offices and taking over a computer system that contained emails he had been unable to subpoena.  In the latter case, the County had to seek a restraining order against its own Sheriff!

Unfortunately, Arpaio’s indifference to due process and individual rights obviously has percolated to the entire staff.  Here is the most recent craziness — during  a trial, a Sheriff’s deputy starts going through the defendant’s attorney’s papers, and takes some of them  (all of which were attorney-client privileged).

The explanation was that the documents had not been screened for contraband and weapons, so the deputy had to take (what looks like a couple of sheets of paper) away to study them to make sure there was no gun  stapled to them or something.  This so lame I am not sure how they can even say it with a straight face, but true to form the Sheriff’s office is rallying around its own.  More in the AZ Republic.

Why is it the organizations (ie police departments) whom we entrust with uniquely scary power to use force on us citizens tend to have the least well developed internal checks and accountability processes?

Update: Random example of police not getting prosecuted for abuse of power, from today’s news.  Folks like Miller and Radley Balko can fill their blogs with these type cases every day and not get them all.

…requiring dash cameras in every police vehicle would be a great idea.  Via Radley Balko, of course, video in his post here.

I do think Ms. Harmon has her lawsuit a bit misdirected.  I don’t think Tasers per se are the problem.  If this guy didn’t have a Taser, it would just be a nightstick or physical force.  The issue is that many police act as if they are dictators of the local area within their line of sight.

from the AZ Republic:

A Yale University student is suing US Airways for $1 million because of the loss of a video game system he claims was taken from his luggage.

Ohio resident Jesse Maiman, 21, claims his Xbox 360 console was taken from his bag during a December flight from New Haven, Conn. to Cincinnati.

He is suing for $1,700 for the video game system and for the maximum damages allowable by law, or $1 million.

You can read the article all day and you will not find any extenuating circumstances to justify this arbitrarily absurd number.   Even $1,700 for the game system itself is absurd.  One hour of legal time on this would be worth more than the machine.

Apparently, Blackwater wants to be tried under Sharia law:

I learn that Blackwater has filed a motion in a lawsuit claiming
that since the mishap they’re being sued for (a plane crash) happened
in Afghanistan, the lawsuit should be adjudicated via sharia law, not
U.S. law. That’s ironic enough on its own merits, but the explanation is even better:

In
April, Blackwater asked a federal judge in Florida to apply Islamic
law, commonly known as Shari’a, to the case. If the judge agreed, the
lawsuit would be dismissed. Shari’a law does not hold a company
responsible for the actions of employees performed within the course of
their work.

LOL, my guess is that they really don’t want the precedent set that Blackwater will henceforth be held to Sharia law in Afghanistan.  By the way, don’t miss your chance to buy some gear or posters in the Blackwater company store.  I found it randomly checking out their site.  They actually have some really good looking posters, much better looking than the stuff sold in company stores where I have worked.

WSJ, via Libertarian Leanings:

One of the worst places, in
term of frivolous lawsuits, was Jefferson County. It became renowned as
the lawsuit capital of the country, with more plaintiffs than
residents. This is the infamous county where one pharmacist was named
in more than 1,000 lawsuits. In one legendary case against a
pharmaceutical company that sold the diet pill Pondimin (part of the
weight-loss combination known as fen-phen, which was later banned), a
Jefferson County jury awarded $1 billion to the family of a woman who
had taken the drug.

But four years ago, Mississippi transformed itself
from judicial hell hole to job magnet, a story that is instructive for
other states trying to attract jobs in turbulent economic times. The
lessons here are especially timely, because the pro-growth tort reform
trend that was once spreading across the country may soon reverse
course….

Almost overnight, the flow
of lawsuits began to dry up and businesses started to trickle in.
Federal Express invested $1 billion in a new facility in the state.
Toyota chose Mississippi over about a dozen other states for a new $1.2
billion, 2,000-worker auto plant. The auto maker has stipulated that
the company would pull up stakes if the tort reforms were overturned by
the legislature or activist judges.

That hasn’t happened. About 60,000 new jobs have
arrived in four years – not a small number in a workforce of about 1.3
million – and a sharp improvement from the 30,000 jobs lost in the four
years before Mr. Barbour took office. Since the law took effect, the
number of medical malpractice lawsuits has fallen by nearly 90%, which
in turn has cut malpractice insurance costs by 30% to 45%, depending on
the county.

From the Arizona Republic:

Three day laborers filed a lawsuit Tuesday that seeks to overturn a
suburb’s law prohibiting people standing on public streets from
soliciting employment from occupants of cars.

The federal lawsuit alleges Cave Creek’s law passed is unconstitutional
because it restricts the free speech rights of people trying to find
work as day laborers.

“Cave Creek does not have the right to pick and choose who has free
speech rights,” said Monica Ramirez, an attorney for the American Civil
Liberties Union, one of the group’s representing the day laborers. “The
town cannot bar people from peaceably standing in public areas and
expressing their availability to work.”

The stated reason for the law is this, but don’t believe it:

Mayor Vincent Francia said the law was a response to concerns raised by
residents over traffic being impeded by people congregating on street
corners.

If you followed the genesis of this law, it has less than zero to do with traffic.  It was crafted as a way to prevent people of Mexican birth, with or without the proper papers from the US government, from seeking work in Cave Creek.  Which explains why sheriff Joe Arpaio is so eager to help enforce the law, and why, by some statistical fluke, everyone arrested under the law seems to be of Mexican Latin descent  (the three laborers filing the suit are Mexican and Guatemalan and are in this country legally).

I am happy to see this suit get filed under whatever auspices that it can, and have in the past supported using the first amendment to protect free commerce.  Further, I am thrilled to see the ACLU, given its Stalinist origins, for once actively support the right to publicly advertise and conduct commerce.  However, it is sad to me that Thomas Jefferson and company did not think it necesary to enshrine the right to free commerce as an protected right up there with speech and association.

One might argue that the enumerated power concept and the 9th amendment should be protection enough, but obviously Jefferson did not think so or he would not have pushed for the Bill of Rights.   And saying the following may just prove that I am not a Constitutional expert, but it strikes me that another problem with the original Constitution that probably wasn’t fixable at the time was the fact that the Bill of Rights did not originally restrain the states, only the Federal government.  Only with the beat-down of states rights concepts in the Civil War and the passage and later interpretation of the 14th amendment did the Supreme Court begin to apply the Bill of Rights to states and municipalities as well.  It is good that they have done so, but these protections enforced on states only tend to be the enumerated protections of the Bill of Rights.  In fact, in this context, the 9th is meaningless because it reserves unenumerated powers to the people or the states, so it contributes nothing to reigning in municipalities, only the Feds. 

All that being said, it should would have been nice to have three extra words such as "or conduct commerce" inserted after assembly:

Congress shall make no law respecting an establishment of
religion, or prohibiting the free exercise thereof; or abridging the
freedom of speech, or of the press; or the right of the people
peaceably to assemble [or conduct commerce], and to petition the Government for a redress of
grievances.

The City of Phoenix is subsidizing a mall developer to the tune of $100 million dollars.  Why?

Desperate to keep another Nordstrom store out of Scottsdale, the City
of Phoenix put together a $100 million incentive deal to lure the
upscale retailer to the new CityNorth development.

That picture emerged in Maricopa County Superior Court arguments Monday over the constitutionality of the package.

That deal bought a parking deck — at $30,000 per parking spot.

You see, the developer and its allies in city hall were afraid that Nordstrom’s might instead locate their new store waaaaayyyyy over in Scottsdale, probably at the shopping development getting started … about a mile away and all of one exit further down loop 101, as show below or here.

Here is the gist of it:

At issue in the lawsuit is an agreement between the developers
of CityNorth and the city of Phoenix that enables the developers,
Related Urban Development and the Thomas J. Klutznick Co., to retain
half of the project’s sales taxes in exchange for free public parking
spaces in a parking garage. The agreement goes for 11 years or $97.4
million, whichever occurs first.

Now, those of you who are from New York or Boston may be saying — Hmm, free public parking.  Thats a good deal.  Well, in Phoenix, its absurd.  All the mall parking is free.  All the mall parking garages are free.  Every mall around these two locations provide free parking and parking garages.  In fact, a mall developer would get run out of town on a rail in north Scottsdale or Phoenix for even uttering the words "paid parking."  People freak out around here if the valet parking is not free.  Further, the city is trying to somehow portray that the parking is a useful asset for the community at large.  Look at the Phoenix site above.  Do you see a lot of stuff in the surrounding acres that is demanding a lot of parking?

Effectively, this is all a smoke screen for the city giving a $100 million handout to developers to build something, ie free parking, they already had to build.  And the incremental sales revenue argument is absurd.  All the wealthy Scottsdale folks who want to shop at Nordstrom’s are already doing so, or are shopping at nearby Desert Ridge.  Only the worst sort of analysis would show incremental sales from this location – all it will do is shift sales around a bit.

I am reminded of my previous post on the subsidization of business relocations as a prisoners dilemma problem.

Frequent readers will know that I don’t think much of our County Sheriff Joe Arpaio.  Sheriff Joe gains a ton of PR for himself as the "toughest sheriff in America" and relishes in making jail conditions as miserable as possible.  Recognize that this is the jail that holds many people after arrest but before conviction. 

Now on to the figure mentioned in the Dickerson piece of 2,150
"prison condition" lawsuits since 2004. Anyone with two licks of sense
can go online at pacer.psc.uscourts.gov, or dockets.justia.com,
enter "Arpaio" into the federal court docket, then count the lawsuits
that name "prison conditions" as the cause. Count back to 2004, and as
of mid-December, that number was more than 2,150.

The same search for
the top jail custodians in L.A., New York, Chicago, and Houston nets a
total of only 43 "prison condition" lawsuits.

Remember, those 2,150
lawsuits against Arpaio are only in federal court. There are hundreds
more listed online with the Maricopa County Superior Court, at superiorcourt.maricopa.gov/docket/civilcourtcases/…..

                                       

"For the period January 1, 1993, to [November 29, 2007], the county
has paid $30,039,928.75 on Sheriff Department General Liability
claims," state the docs. "This figure includes all payments, attorney
fees, other litigation expenses, settlements, payments on verdicts,
etc."

Additionally, New Times
asked Crowley how much the lawsuit insurance policy that also covers
the sheriff has cost taxpayers. Crowley croaked, "The county has paid
for General Liability coverage for the period 3-1-95 to 3-1-08 total
premiums of $11,345,609.50."

Keep in mind that this
liability coverage figure is high, in part, because of all those
lawsuit payoffs to relatives of dead inmates.

From 1995 to 1998, the county paid $328,894 a year for an insurance policy with a $1 million deductible.                                       

Today,
Maricopa County pays a yearly premium of $1.2 million for outside
insurance with a $5 million deductible. For any lawsuit that costs $5
million or less, the county foots the entire bill. It’s the best policy
the county can buy because of Arpaio’s terrible track record.

In the earlier days of this blog, I used to post links to a lot of insane lawsuits.  The lawsuits just keep coming, but I have lost the energy to keep posting such stupidity.  And besides, Overlawyered does such a good job and seems to have infinite patience. 

But it was worth noting a silly shareholder suit that the media actually seems to have sniffed out for what it is:  Pure garbage.  For those who are not aware, there are a group of law firms who immediately file suit against any company whose stock drops by more than a few percent.  Bill Lerach, soon to be taking up residence in jail, used to keep a whole bullpen of folks on a sort of retainer to hold shares in numerous companies, so he instantly had someone close at hand who could file suit when any stock drops.  And since stocks go up and down, often in ways that the company itself has no control over, this leads to a lot of lawsuits.

Recently, the maker of Crocs sandles apparently had an IPO, had its stock price shoot up, and then had its stock price fall back when the company could not sustain its previous torrid growth pace.  Al Lewis of the Denver Post takes it from there:  (HT Overlawyered, of course)

Anybody who purchased stock in
Niwot-based Crocs Inc. between July 27 and Oct. 31 should not join the
class-action shareholders lawsuit that was recently filed against the
company and its stock-dumping executives.

Instead, they should look themselves in the mirror and admit two things:

      

I look ridiculous in these plastic shoes.

      

Anybody
who would pay an average of more than $60 a share for a company that
makes ugly plastic shoes deserves to take a hit in the stock market.

He continues:

Crocs and its officers also allegedly
misrepresented or failed to disclose their distribution problems in
Europe and their rising inventory levels, the lawsuit alleges. They
also failed to disclose that sales of their hole-riddled plastic clogs
were suddenly becoming more of a seasonal item. Imagine that! Sandals
seasonal? Who knew?

By the way, if you really want your head to explode, take a minute a think about shareholder lawsuits.  A group of shareholders are suing the company for a fall in the stock price.  Who do you think pays?  Why, current shareholders!  Though I do not accept the "logic" of these suits, if one were to accept their logic, then the most guilty party is the stockholder who sold the plaintiffs their stock just before the drop.  But these folks are exactly who will NOT owe any money on the suit.  They are no longer owners.  The people who will pay will be the owners of the stock at whatever time the suit settles, likely many people who bought in after the plaintiffs did.  The only real winner when the shareholders pay themselves such a verdict are the lawyers, who rake off 30%.  More on this bizarre situation here.

Update:  I will have to think about this more, but it kind of reminds me of a prisoners dilemma game in which the prosecutor gets a monetary bonus that increases with longer prison terms.

Here they go again.  Another company is attempting to commit public relations suicide by blowing up the negative commentary of a small, low-traffic blogger into a national story.

An unlikely Internet frontier is Paris, Texas, population 26,490,
where a defamation lawsuit filed by the local hospital against a
critical anonymous blogger is testing the bounds of Internet privacy,
First Amendment freedom of speech and whistle-blower rights.

A state district judge has told lawyers for the hospital and the
blogger that he plans within a week to order a Dallas Internet service
provider to release the blogger’s name. The blogger’s lawyer, James
Rodgers of Paris, said Tuesday he will appeal to preserve the man’s
anonymity and right to speak without fear of retaliation.

Rodgers said the core question in the legal battle is whether a
plaintiff in a lawsuit can "strip" a blogger of anonymity merely by
filing a lawsuit. Without some higher standard to prove a lawsuit has
merit, he said, defamation lawsuits could have a chilling effect on
Internet free speech.

"Anybody could file a lawsuit and say, ‘I feel like I’ve been defamed. Give me the name,’ " Rodgers said.

The blog about problems at Essent Healthcare is here, called The-Paris-Site.

Interestingly, the hospital, owned by a company called Essent Healthcare, appears to be using the medical privacy act HIPPA as a bludgeon to try to stifle criticism.  To make a case against the hospital, general criticisms about poor care and medical mistakes are best backed up with real stories.  But the hospital is in effect saying that real stories can’t be used, since doing so violates HIPPA.  I don’t know if this is or is not a correct application of HIPPA, but it is a danger of HIPPA that I and others warned about years ago.  The hospital goes on hilariously about how they are not really worried about the damage to their reputation, but for the poor patients whose medical details ended up in the blogger’s hands.  Memo to health care workers in the future:  If you think the hospital screwed up my care, you have my blanket permission to release the details of said screw-up.

Before starting my own company, I have worked in a number of senior jobs at publicly traded companies and a few soon-to-be-f*cked Internet ventures.  In several of these cases, I and my fellow managers came in for pretty rough and profane criticism.  In many cases the posts were hilarious, positing well-oiled multi-year conspiracies from a management team that was just trying to survive the day.  Most of us were pretty rational about these sites – the more you try to respond to them, the more attention you give them.  The best response is to ignore them except maybe on Friday night when you can drink some beers and laugh out loud reading the commentary.  But there were always a few folks whose ego just got inflamed by the comments, even though they were seen by maybe 12 people worldwide.  They wanted to put a stop to the commenters.

I am sure that this is what is happening here.  Because any good PR person who has been in the business for more than 5 minutes would tell you that the worst thing you could do for a critic with a small audience is to a) turn them into a martyr and b) increase their audience about a million-fold.  These guys at Essent are just nuts, and in the heat of ego preservation are in the process of making a massive mistake.

I am reminded of TJIC’s response when a lawyer threatened to file a BS copyright suit against him:

With regards to your statement that you’ve been “looking forward for a
class action lawsuit on a case like this”, I, too, would enjoy such a
lawsuit. The publicity that we would derive from defeating your firm in
court over a baseless allegation of copyright infringement, brought
about by a law firm and a lawyer that does not understand the First
Sale doctrine, and which are entirely ignorant of the Supreme Court
case law on the topic, would be of incalculable value to us, and would
be a very cost efficient way to further publicize our service.

Hat Tip to Overlawyered for the link.

Update: The blogger appears to have been around since 2005.  The article said that as of June, or after about 2 years of operation, he had 170,000-ish page views.  He now appears to be at about 230,000 just three months later and only a few weeks after the story went public.  Q.E.D.

Update #2:  I forgot to include my opinion on the case.  There has got to be some higher legal bar to be cleared to strip the anonymity of a blogger than just asking for it to happen during discovery on a lawsuit.  If the legislature is not going to establish this bar, then a higher court is going to have to do so. 

Many of us remember the old Pepsi challenge commercials, where blind taste tests vs. Coke showed people preferring Pepsi.  One of the interesting results of these commercials was that Pepsi gained market share, but Coke did not lose it — much of the Pepsi market share gain came from other brands.  In essence, the commercials established in consumer’s minds that the cola choice was Coke or Pepsi, and so it did as much for Coke as it did Pepsi.

So now take this experience to anti-smoking commercials.  It turns out that they may backfire:

The more anti-smoking ads middle schoolers see, the more likely they are to smoke, according to a study in the August issue of Communication Research.
Hye-Jin Paek, an assistant professor at the University of Georgia’s
College of Journalism and Mass Communication, and Albert Gunther, a
professor of life sciences communication at the University of
Wisconsin at Madison, analyzed data from surveys that asked middle
school students about their exposure to anti-smoking messages and their
intention to smoke:

They found that, overall, the
more the students were exposed to anti-smoking messages, the more
inclined they were to smoke. The exception—where exposure to
anti-smoking ads correlated with a reduced intention to smoke—occurred
among students who said their friends were influenced by anti-smoking
messages.

In the context of other advertising research, such as the old Coke/Pepsi campaign, this is not surprising.  It is even less surprising for this type of ad, where a certain amount of anti-authoritarian response can be expected.  In fact, I have seen a number of ads that use this anti-authoritarian streak and distrust of the government as a feature.  Ads that say "The government doesn’t want you to know about X" or "What the oil companies don’t want you to know."

I wonder when the first member of the plaintiff’s bar will initiate a lawsuit against the tobacco companies for promoting teenage smoking by running… anti-smoking ads.